Gold, silver, pgms, mining and geopolitical comment and news

Indaba

West and Central African focused gold miner, Randgold Resources, invariably provides updates on its key operations in the runup to the big Mining Indaba meeting in Cape Town alongside which the company, now traditionally. announces it Q4 and prior year figures. We’ve already reported here on the big new Kibali mine, which has been built in a remote part of the north-eastern Democratic Republic of Congo which is due to become the company’s largest gold mine, but up until now the Loulo-Gounkoto complex in Mali has been the company’s largest operation in terms of gold production.

Ehe company says its Loulo-Gounkoto gold mining complex is on track to improve on its record performance in 2016, with last year’s production expected to reach a new peak and at lower cash costs of production, Chiaka Berthe, the company’s general manager of its West African operations, said to the media in Bamako, the Malian capital..

Speaking at the quarterly update for local media, Berthe said this positioned the complex strongly to continue rolling out its 10-year business plan, which targets production in excess of 600,000 ounces per year.

Berthe announced that the Malian ministry of mines had approved the development of a super pit at the Gounkoto opencast mine. The existing mining convention is being reviewed to accommodate this new investment.

Also at the briefing, Randgold chief executive Mark Bristow said the company’s continuing investment in Mali had shown the way for others to follow, and the current development of new mines would bring additional production on line and increase the already considerable contribution the mining industry makes to the country’s economy.

Group regional manager West Africa Mahamadou Samake also highlighted the importance of maintaining a fiscal and regulatory environment capable of attracting investment and re-investment in the mining sector.

“It is therefore imperative that the current mining code review is undertaken with this objective in mind, and any proposed changes should be made in light of the code’s relative attractiveness compared to surrounding countries which are competing for the same exploration and investment dollars. This is particularly important in coping with the challenges inherent in developing and operating a mine in an infrastructurally challenged country like Mali, and the difficulty of finding replacement reserves. The government should focus on working with the industry to maintain Mali’s position as one of the premier destinations for mining investment in West Africa,” Samake said.

Bristow also appealed to Mali to consult with its neighbours in finding a cross-border solution to the growing problem of illegal mining. In some parts of Mali this was now out of control, he said, and the damage to property and resources, if it was allowed to continue, would discourage global investors.

He noted that Randgold and the Malian fiscal authorities were working together to resolve their outstanding tax and TVA issues.

The company’s full Q4 and FY2017 operational results and financials are due to be released next Monday, when Bristow will make his presentation in Cape Town.

This year’s Mines & Money London ended Thursday and I have to say it probably brought together the best array of mining, metals and minerals expert speakers perhaps ever assembled under one roof. Its problem – a great problem to have perhaps – was that there were so many really strong individual presentations, panel discussions and one-on-one interviews (with good moderators who ensured everything ran smoothly and to schedule – a major achievement in itself) that for major parts of the four day event the talks had to be split into three streams and it was thus impossible to take in all those one would have liked to have listened to. And, to an extent one suffered from information overload anyway. How the organisers can top this in the future in terms of invited high quality speakers is hard to contemplate.

I suppose the other basic difficulty facing the organisers is how the conference is paid for and the effects this has on speaker distribution through the various streaming locations. While the conference centre in Islington – although not basically designed as such – did have space to accommodate all these, the fact is that the way these conferences are financed is for the greater part of income to be provided in speaker/exhibitor packages to be sold to those companies which wish to put their investment case forward – and these speakers almost certainly needed to have the main presentation auditorium to present in to keep them happy. In a publishing parallel, these are the advertisers while the expert speakers provide the editorial. This means that some of the plethora of really strong speakers and discussions get relegated to the smaller satellite conference rooms which accommodate fewer people while the ‘advertisers’ find themselves presenting to sometimes a three-quarters empty auditorium (but for them it is perhaps better than to an even smaller audience in one of the smaller satellite presenting rooms.)

The alternative, of course is to only have the expert speakers but charge much larger sums for conference attendees to come in – which would then almost certainly substantially reduce the revenues and the overall event size. This would reduces too the networking opportunities, which provide one of such a conference’s other main strengths. Mines & Money combines both sides here, but many delegates consider the price to attend is already too high anyway, so bumping this up could be very counter productive. A major dilemma for the organisers.

Mines & Money is thus not the only major event which utilises this kind of business plan. The ever popular Mining Indaba in Cape Town in February (a great location advantage in the heart of the northern winter) works similarly, although perhaps its specific problem is that it has thrown its exhibition space open to the big mining equipment manufacturers which have much more money to spend on the exhibits and thus dominate the space – so much so that the junior and mid-tier miners and explorers at whom the conference was originally aimed – feel they are being squeezed out.

But back to this year’s Mines & Money – the speaker programme was, as mentioned above, exceptional, right from day 1. The big names here were legion. Presentations ranged from the sublime – perhaps Grant Williams’ polished performance presentation on the final day was the absolute highlight in that it combined music, graphics, lots of humour and some great analytical content, but with other hugely polished presenters like Rick Rule, Frank Holmes, Pierre Lassonde, Tom Albanese, David Humphreys, Mark Bristow, Ian Hannam, Robin Griffiths to name just a few on the main programme. There were also many more top names on the various panels and discussion groups – together with an array of perhaps lesser known, but hugely informative presenters covering virtually all aspects of global mining, metals and minerals. This was a great conference line-up. Even yours truly got into the act interviewing Grant Williams in one of the on-on-ones – an easy task give Grant has so much to say.

Perhaps the other criticism – if one can criticise such a strong event at all – is that nearly all the main presenter speaker slots were only 20 minutes in length, whereas so many of the main speakers would have happily been able to take much more time putting their views across. Because they were all such strong presenters (I perhaps only attended one main presentation which could have been described as under-prepared and disappointing, even though the speaker had good presence), this would not have been a problem in audience attention – indeed would have been welcomed. But there are only so many hours in the day, and even a four day conference is considered long nowadays. Who would be a conference organiser?

The accompanying exhibition this year was considerably smaller than in previous years, but that was hardly surprising given the state of the resource sector. It did seem to be pretty well attended throughout and the exhibit floor also provided a great networking space.

Overall a really good event for those wishing to hear some great expert views on our industry.